RESTATED BY LAWS
                                       of
                            FACTORY CARD OUTLET CORP.

                               As of July 25, 1997

I        OFFICES

         The corporation may have offices, in addition to its principal office
         at such places as from time to time may be determined by the Board of
         Directors (the "Board" ) .

II       MEETINGS OF STOCKHOLDERS

Section 1. PLACE OF MEETINGS. Meetings of the stockholders may be held at the
         principal office of the corporation or at such other place within or
         without the State of Delaware as may be designated by the Board and
         stated in the notice of the meeting.

Section 2. ANNUAL MEETING. The annual meeting of stockholders of the
         corporation shall be held, in each year, on the date and at the time as
         shall be fixed by the Board and stated in the notice of said meeting.
         At annual meetings, the stockholders shall elect directors by a
         plurality vote and shall transact such other business as may properly
         be brought before the meeting.

Section 3. SPECIAL MEETINGS. Special Meetings of the stockholders may be called
         by resolution of the Board or by the Chairman of the Board or President
         and shall be called by the President or Secretary upon the written
         request (stating the purpose or purposes of the meeting) of a majority
         of the Board or a majority of the stockholders of the Corporation. Only
         business related to the purposes set forth in the notice of the meeting
         may be transacted at a special meeting.

Section 4. NOTICE OF MEETINGS, STOCKHOLDER PROPOSALS AND NOMINATIONS. (a)
         Except as otherwise provided by law, and subject to the provisions set
         forth in subsections (b) and (c) hereof, written or printed notice
         stating the place, date and hour of the meeting and, in case of a
         special meeting, a brief statement of the purpose or purposes for which
         the meeting is called, shall be delivered not less than ten (10) nor
         more than sixty (60) days before the date of every meeting of
         stockholders either personally or by mail, by or at the direction of
         the President or the Secretary, to each stockholder of record entitled
         to vote at such meeting. If mailed, such notice shall be deemed to be
         delivered when deposited in the United States mail addressed to the
         stockholder at his or her address as it appears on the records of the
         corporation, with postage thereon prepaid. Whenever any notice is
         required to be given under the provisions of Delaware law, the
         certificate of incorporation, or these By-Laws, a waiver thereof in
         writing signed by the person or persons entitled to such notice,
         whether it be before or after the time stated therein, shall be deemed
         equivalent to the giving of such notice. It shall not be requisite to
         the validity of any meeting of 
<PAGE>

         stockholders that notice thereof, whether prescribed by law, by the
         certificate of incorporation or by these By-Laws, shall have been given
         to any stockholder who attends in person or by proxy, except when the
         person attends a meeting for the express purpose of objecting at the
         beginning of the meeting to the transaction of any business because the
         meeting is not lawfully called or convened. No notice other than by
         verbal announcement need be given of any adjourned meetings of
         stockholders unless the adjournment is for more than thirty (30) days
         or a new record date is fixed for the adjourned meeting.

                  (b) At an annual meeting of the stockholders, commencing with
         the annual meeting held in 1998, only such business shall be conducted
         as shall have been brought before the meeting (i) by or at the
         direction of the Board or (ii) by any stockholder of record of the
         corporation who complies with the notice procedures set forth in this
         subsection (b). For business to be properly brought before an annual
         meeting by a stockholder, the stockholder must have given timely notice
         thereof in writing to the Secretary of the corporation. To be timely, a
         stockholder's notice must be delivered to or mailed and received at the
         principal executive offices of the corporation not less than ninety
         (90) days nor more than one hundred and twenty (120) days prior to the
         one year anniversary of the date of the last annual meeting of
         stockholders; provided, however, that with respect to the annual
         meeting of stockholders of the corporation held in 1998, a
         stockholder's notice must be delivered to or mailed and received at the
         principal executive offices of the corporation by May 1, 1998. A
         stockholder's notice to the Secretary shall set forth as to each matter
         the stockholder proposes to bring before the annual meeting (i) a brief
         description of the business desired to be brought before the annual
         meeting and the reasons for conducting such business at the annual
         meeting, (ii) the name and address, as they appear on the corporation's
         books, of the stockholder proposing such business, (iii) the number of
         shares of common stock of the corporation which are beneficially owned
         by the stockholder and (iv) any material interest of the stockholder in
         such business. Notwithstanding anything in these By-Laws to the
         contrary, no business shall be conducted at an annual meeting except in
         accordance with the procedures set forth in this subsection (b). The
         chairman of an annual meeting shall, if the facts warrant, determine
         and declare to the meeting that business was not properly brought
         before the meeting and in accordance with the provisions of this
         subsection (b), and if he or she should so determine, he or she shall
         so declare to the meeting and any such business not properly brought
         before the meeting shall not be transacted.

                  (c) Nominations of persons for election to the Board may be
         made at any meeting of stockholders occurring after the annual meeting
         of stockholders held in 1997 (i) by or at the direction of the Board or
         (ii) by any stockholder of the corporation entitled to vote for the
         election of directors at the meeting who complies with the notice
         procedures set forth in this subsection (c). Such nominations, other
         than those made by or at the direction of the Board, shall be made
         pursuant to timely notice in writing to the Secretary of the
         corporation. To be timely, a stockholder's notice shall be delivered to
         or mailed and received at the principal executive offices of the
         corporation not less than ninety (90) days nor more than one hundred
         and twenty (120) days prior to the one year anniversary of the date of
         the last annual meeting of stockholders; provided, however, that with
         respect to the annual meeting of stockholders of the corporation held
         in 1998, a stockholder's notice must be delivered to or mailed and
         received at the principal executive officers of the corporation by May
         1, 1998. Such stockholder's notice shall set forth (i) as to each
         person whom the stockholder proposes to nominate for election or
         re-election as a director, all information relating to such person that
         is required to be disclosed in solicitations of proxies for election of
         directors, or is otherwise required, in each case pursuant to
         Regulation 14A under the Securities 
<PAGE>

         Exchange Act of 1934, as amended (including such person's written
         consent to being named in the proxy statement as a nominee and to
         serving as a director if elected); and (ii) as to the stockholder
         giving the notice, the name and address, as they appear on the
         corporation's books, of such stockholder and the number of shares of
         common stock of the corporation which are beneficially owned by such
         stockholder. At the request of the Board any person nominated by the
         Board for election as a director shall furnish to the Secretary of the
         corporation that information required to be set forth in a
         stockholder's notice of nomination which pertains to the nominee. No
         person shall be eligible for election as a director of the corporation
         unless nominated in accordance with the procedures set forth in these
         By-Laws. The chairman of the meeting shall, if the facts warrant,
         determine and declare to the meeting that a nomination was not made in
         accordance with the procedures prescribed by these By-Laws, and if he
         or she should so determine, he or she shall so declare to the meeting
         and the defective nomination shall be disregarded.

Section 5. STOCKHOLDER LIST. The officer having charge of the stock ledger of
         the corporation shall make, at least 10 days before every meeting of
         the stockholders, a complete list of the stockholders entitled to vote
         at such meeting arranged in alphabetical order, showing the address of
         each stockholder and the number of shares registered in the name of
         each stockholder. Such list shall be open to the examination of any
         stockholder, for any purpose germane to the meeting, during ordinary
         business hours, for a period of at least 10 days prior to the meeting,
         either at a place within the city where the meeting is to be held,
         which place shall be specified in the notice of the meeting or, if not
         so specified, at the place where the meeting is to be held. The list
         shall also be produced and kept at the time and place of the meeting
         during the whole time thereof, and may be inspected by any stockholder
         who is present.

Section 6. QUORUM. The holders of a majority of the shares entitled to vote,
         represented in person or by proxy, shall constitute a quorum for the
         transaction of business. The stockholders present in person or by proxy
         at a duly organized meeting may continue to do business until
         adjournment, notwithstanding the withdrawal of enough stockholders to
         leave less than a quorum. Less than a quorum may adjourn. In the
         absence of a quorum a majority in voting interest of those present, or
         in the absence of all the stockholders, any officer entitled to preside
         at or act as Secretary of the meeting, may adjourn the meeting until a
         quorum is present. At any adjourned meeting at which a quorum is
         present any action may be taken which might have been taken at the
         original meeting. Whenever the holders of any class or series or shares
         are entitled to vote separately on a specified item of business, the
         provisions of this section shall apply in determining the presence of a
         quorum of such class or series for the transaction of such specified
         item of business.

Section 7. VOTING; PROXIES. Except as otherwise provided by law or in the
         certificate of incorporation, each stockholder of record shall be
         entitled to one vote for every share registered in his or her name and
         may attend meetings and vote or express consent or dissent without a
         meeting either in person or by proxy. Corporate action to be taken by
         stockholder vote, other than the election of directors, shall be
         authorized by a majority of the votes cast at a meeting of
         stockholders, except as otherwise provided by law or in the certificate
         of incorporation. Directors shall be elected in the manner provided in
         Section 1 of Article III of these By Laws. Voting need not be by ballot
         unless requested by a stockholder at the meeting or ordered by the
         chairman of the meeting. Every proxy must be signed by the stockholder
         or his or her attorney in fact. The 
<PAGE>

         validity and enforceability of any proxy shall be determined in
         accordance with Section 212 of the General Corporation Law of the State
         of Delaware, as amended from time to time.

Section 8. ACTIONS BY STOCKHOLDERS. No action required to be taken or which may
         be taken at any annual or special meeting of stockholders of the
         Corporation may be taken except at a duly called meeting of the
         stockholders of the Corporation, or upon unanimous written consent of
         the stockholders entitled to vote thereat. Stockholders of the
         Corporation may only propose actions to be taken by the Corporation and
         nominate members of the Board of Directors upon ninety (90) days prior
         written notice to the Corporation; provided that, with respect to all
         meetings of stockholders held after the annual meeting of stockholders
         of the corporation held in 1997, the right of stockholders to propose a
         matter or nominate a person for election to the Board shall be subject
         to Section 3 of Article II of these By-Laws.

Section 9. VOTING PROCEDURES AND INSPECTORS OF ELECTION AT MEETINGS OF
         STOCKHOLDERS. The Board, in advance of any meeting of stockholders, may
         appoint one or more inspectors to act at the meeting and make a written
         report thereof. The Board may designate one or more persons as
         alternate inspectors to replace any inspector who fails to act. If no
         inspector or alternate is able to act at a meeting, the person
         presiding at the meeting may appoint, and on the request of any
         stockholder entitled to vote thereat shall appoint, one or more
         inspectors to act at the meeting. Each inspector, before entering upon
         the discharge of his or her duties, shall take and sign an oath
         faithfully to execute the duties of inspector with strict impartiality
         and according to the best of his or her ability. The inspectors shall
         (a) ascertain the number of shares outstanding and the voting power of
         each, (b) determine the shares represented at the meeting and the
         validity of proxies and ballots, (c) count all votes and ballots, (d)
         determine and retain for a reasonable period a record of the
         disposition of any challenges made to any determination by the
         inspectors, and (e) certify their determination of the number of shares
         represented at the meeting and their count of all votes and ballots.
         The inspectors may appoint or retain other persons or entities to
         assist the inspectors in the performance of their duties. Unless
         otherwise provided by the Board, the date and time of the opening and
         the closing of the polls for each matter upon which the stockholders
         will vote at a meeting shall be determined by the person presiding at
         the meeting and shall be announced at the meeting. No ballot, proxies
         or votes, or any revocation thereof or change thereto, shall be
         accepted by the inspectors after the closing of the polls unless the
         Court of Chancery of the State of Delaware upon application by a
         shareholder shall determine otherwise.

Section 10. CONDUCT OF MEETINGS. The Board may to the extent not prohibited by
         law adopt by resolution such rules and regulations for the conduct of
         the meeting of stockholders as it shall deem appropriate. Except to the
         extent inconsistent with such rules and regulations as adopted by the
         Board, the Chairman of the Board shall be the chairman of any meeting
         of stockholders, and such chairman shall have the right and authority
         to prescribe such rules, regulations and procedures and to do all such
         acts as, in the judgment of such chairman, are appropriate for the
         proper conduct of the meeting. Such rules, regulations or procedures,
         whether adopted by the Board or prescribed by the chairman of the
         meeting, may to the extent not prohibited by law include, without
         limitation, the following: (i) the establishment of an agenda or order
         of business for the meeting; (ii) rules and procedures for maintaining
         order at the meeting and the safety of those present; (iii) limitations
         on attendance at or participation in the meeting to stockholders of
         record of the corporation, their duly authorized and constituted
         proxies or such other persons as the chairman of the meeting shall
<PAGE>

         determine; (iv) restrictions on entry to the meeting after the time
         fixed for the commencement thereof; and (v) limitations on the time
         allotted to questions or comments by participants. Unless and except to
         the extent otherwise determined by the Board or the chairman of the
         meeting, meetings of stockholders shall not be required to be held in
         accordance with the rules of parliamentary procedure.

  ARTICLE II
         BOARD OF DIRECTORS

Section 1. NUMBER, QUALIFICATION AND ELECTION. The business, affairs and
         property of the corporation shall be conducted and managed by its
         Board, which may exercise all the powers of the corporation, except
         such as are by statute, or by the certificate of incorporation or by
         these By Laws expressly conferred upon, reserved to, or required to be
         exercised by the stockholders. The number of directors which shall
         constitute the Board shall be nine (9). The number of directors shall
         thereafter be established from time to time by resolution of the Board.
         Subject to the provisions of the certificate of incorporation, the
         persons receiving the greatest number of votes at an election of the
         directors at an annual meeting of stockholders shall be the directors
         and shall hold office until a successor is duly elected and qualified
         or until his or her earlier death, resignation or removal as
         hereinafter provided.

Section 2. PLACE OF MEETINGS. The Board may hold meetings, have one or more
         offices, and keep the books of the corporation, except as otherwise may
         be provided by law, within or without the State of Delaware, at such
         places as the Board may determine from time to time.

Section 3. VACANCIES. In case of a vacancy on the Board resulting from death,
         resignation, disqualification, increase in the number of directors or
         other cause, such vacancy shall be filled for the unexpired term by the
         vote of a majority of the remaining directors, though less than a
         quorum, unless otherwise required by law or by the certificate of
         incorporation.

Section 4. QUORUM. At all meetings of the Board, a majority of the entire Board
         shall constitute a quorum for the transaction of business. In the
         absence of a quorum, a majority of the directors present may adjourn
         the meeting from time to time until a quorum is present. The vote of a
         majority of directors present at a meeting at which a quorum is present
         shall be the act of the Board.

Section 5. ANNUAL MEETINGS. Annual meetings of the Board shall be held for the
         election of officers and the transaction of other business. Such
         meetings shall be held without notice either immediately after the
         annual meeting of stockholders and at the same place, or as soon as
         practicable within 20 days after the final adjournment of the annual
         meeting of stockholders, upon notice as hereinafter provided in Section
         8 of this Article III, at such time and place as shall be determined by
         the Chairman of the Board or President.

Section 6. REGULAR MEETINGS. In addition to the annual meeting, regular meetings
         of the Board shall be held at such times and places as may be fixed,
         from time to time, by the Board.
<PAGE>

Section 7. SPECIAL MEETINGS. Special meetings of the Board shall be held 
         whenever called by the Chairman of the Board, the President, or by any
         two directors.

Section 8. NOTICE OF MEETINGS; WAIVER OF NOTICE. Notice of the time and place
         of each special meeting of the Board, and of each annual meeting not
         held immediately after the annual meeting of stockholders and at the
         same place, shall be given to each director by mailing it to him or her
         at his or her residence or usual place of business at least 3 days
         before the meeting, or by delivering or telephoning or telegraphing it
         to him or her at least 2 days before the meeting. Notice of any meeting
         need not be given to any director who submits a signed waiver of notice
         before or after the meeting, or who attends the meeting without
         protesting the lack of notice to him or her, either before the meeting
         or when it begins. Notice of any adjourned meeting need not be given,
         other than by announcement at the meeting at which the adjournment is
         taken, if the period of adjournment does not exceed 10 days in any one
         adjournment.

Section 9. RESIGNATION AND REMOVAL OF DIRECTORS. Any director or the entire
         Board may be removed at any time, with or without cause, by the holders
         of a majority of the shares then entitled to vote at an election of
         directors. Whenever the holders of any class or series are entitled to
         elect one or more directors by the provisions of the corporation's
         certificate of incorporation, the provisions of this section shall
         apply, in respect to the removal without cause of a director or
         directors so elected, to the vote of the holders of the outstanding
         shares of that class or series and not to the vote of the outstanding
         shares as a whole. Any director may resign at any time upon written 
         notice to the corporation.

Section 10. COMPENSATION. Directors shall receive such compensation as the
         Board determines, together with reimbursement of their reasonable
         expenses in connection with the performance of their duties. A director
         may also be paid for serving the corporation, its affiliates or
         subsidiaries in other capacities.

ARTICLE III
 COMMITTEES

Section 1. EXECUTIVE COMMITTEE. The Board by resolution adopted by a majority
         of the entire Board, may designate an Executive Committee of one or
         more directors which shall have all the authority of the Board, except
         as otherwise provided in the resolution or by law, and which shall
         serve at the pleasure of the Board. All action of the Executive
         Committee shall be reported to the Board at its next meet meeting. The
         Executive Committee shall adopt rules of procedure and shall meet as
         provided by those rules or by resolutions of the Board.

Section 2. OTHER COMMITTEES. The Board may by resolution provide for such other
         standing or special committees as it deems desirable and discontinue
         the same at its pleasure. Back such committee shall have such powers
         and perform such duties, not inconsistent with law, as may be assigned
         to it by the Board.

Section 3. ALTERNATE MEMBERS. The Board may by resolution appoint one or more
         directors to serve as alternate members of any such committee or to act
         in the absence or disability of members of any such committee with all
         the powers of such absent or disabled members. The Board may by
<PAGE>

         resolution appoint one or more directors to serve as alternate members
         of any such committee or to act in the absence or disability of members
         of any such committee with all the powers of such absent or disabled
         members.

Section 4. ACTION BY WRITTEN CONSENT. Any action required or permitted to be
         taken at any meeting of the Board, or of any committee thereof, may be
         taken without a meeting if all members of the Board or committee, as
         the case may be, consent thereto in writing, and the writing or
         writings are filed with the minutes of proceedings of the Board or
         committee.

ARTICLE IV
         OFFICERS

Section 1. EXECUTIVE OFFICERS. The executive officers of the corporation shall
         be the Chairman of the Board, the President, such number of Vice
         Presidents as the Board may determine (one or more of whom may, in the
         discretion of the Board, be designated as Executive Vice President or
         Senior Vice President), a Secretary, and a Treasurer. The executive
         officers shall be elected by the Board at its annual meeting and each
         such officer shall serve, except as hereinafter provided in Section 2
         of this Article V, until the next annual meeting and until the election
         and qualification of his or her successor. The same person may hold two
         or more offices, but no officer shall execute, acknowledge or verify
         any instrument in more than one capacity, if such instrument be
         required by law, by the certificate of incorporation, or by the By Laws
         to be executed, acknowledged or verified by any two or more officers.

Section 2. REMOVAL OF OFFICERS. Any officer elected or appointed by, or
         pursuant to authority conferred by, the Board may be removed, with or
         without cause, at any time by the affirmative vote of a majority of the
         entire Board.

Section 3. SUBORDINATE OFFICERS AND AGENTS. The Board may appoint subordinate
         officers (including Assistant Secretaries and Assistant Treasurers),
         agents and employees as it may deem advisable, who shall hold their
         positions for such terms and shall exercise such powers and perform
         such duties as shall be determined from time to time by the Board.

Section 4. VACANCIES. If any vacancy shall occur among the officers of the 
         corporation, the Board shall have the power to fill such vacancy.

Section 5. PRESIDENT. Unless otherwise determined by the Board, the President
         shall be the chief executive officer of the corporation and, in the
         absence of the Chairman of the Board, shall preside at all meetings of
         the stockholders and the Board. The President shall perform all duties
         incident to the office of the chief executive of a corporation, and
         such other duties as from time to time may be assigned to him or her by
         the Board.

Section 6. CHAIRMAN OF THE BOARD. The Chairman of the Board shall preside at
         all meetings of stockholders and the Board and shall have such other
         powers and duties as the Board assigns to him or her.
<PAGE>

Section 7. VICE PRESIDENT. Each Vice President shall have such powers and duties
         as the Board or President assigns to him or her.

Section 8. TREASURER. The Treasurer shall be the chief accounting officer of
         the corporation and shall be in charge of the corporation's books and
         accounts. Subject to the control of the Board, he shall have such other
         powers and duties as the Board or the President assigns to him or her.

Section 9. SECRETARY. The Secretary shall be the secretary of, and keep the
         minutes of, all meetings of the, Board and of the stockholders, shall
         be responsible for giving notice of all meetings of stockholders and of
         the Board, shall keep the seal and, when authorized by the Board, shall
         apply it to any instrument requiring it. Subject to the control of the
         Board, he shall have such other powers and duties as the Board or the
         President assigns to him or her. In the absence of the Secretary from
         any meeting, the minutes shall be kept by the person appointed for the
         purpose by the presiding officer.

Section 10. SALARIES. The Board may fix the of officers' salaries, if any, or it
         may authorize the President to fix the salary of any other officer.

Section 11. RESIGNATIONS. Any officer may resign as such at any time by giving
         written notice to the Board or to the President or the Secretary of the
         corporation. Any such resignation shall take effect at the time
         specified therein; and, unless otherwise specified therein, the
         acceptance of such resignation shall not be necessary to make it
         effective.

Section 12. DELEGATION OF DUTIES OF OFFICERS. In the case of the absence or
         disability of an officer of the corporation, or in case the office is
         vacant, or for any other reason that the Board may deem sufficient, the
         Board or any officer designated by it may, except as otherwise provided
         by law, delegate the powers or duties of such officer to any other
         person.

ARTICLE V
         SHARES

Section 1. CERTIFICATES. The shares of the corporation shall be represented by
         certificates in the form approved by the Board. Each certificate shall
         be signed by the Chairman of the Board or President or a Vice
         President, and by the Secretary or an Assistant Secretary or Treasurer
         or an Assistant Treasurer, and shall be sealed with the corporation's
         seal or a facsimile of the seal.

Section 2. TRANSFERS. Shares shall be transferable only on the corporation's
         books, upon surrender of the certificate for the shares, properly
         endorsed. The Board may require satisfactory surety before issuing a
         new certificate to replace a certificate claimed to have been lost or
         destroyed.

Section 3. DETERMINATION OF STOCKHOLDERS OF RECORD. The Board shall fix, in
         advance, a date as the record date for the determination of
         stockholders entitled to notice of or to vote at any meeting of the
         stockholders, or to express consent to or dissent from any proposal
         without a meeting, or to receive payment of any dividend or the
         allotment of any rights, or for the purpose of any other action. The
         record date may not be more than 60 nor less than 10 days before the
         date of 
<PAGE>

         the meeting, nor more than 60 days before any other action. In no event
         shall the transfer books with respect to the corporation's shares be
         closed for such purpose.

Section 4. REPLACEMENT. The Board may authorize any transfer agent and
         registrar of the corporation to issue and register, respectively, new
         certificates in place of any certificates alleged to have been lost,
         stolen or destroyed, and in its discretion and as a condition precedent
         to the issuance thereof, may prescribe any terms and conditions as it
         deems expedient, and may require any board, sureties or indemnities as
         it deems necessary to protect the corporation and each transfer agent
         and registrar against any claim that may be made against them with
         respect to a certificate alleged to have been lost stolen or destroyed.

ARTICLE VI
         MISCELLANEOUS PROVISIONS

Section 1. SEAL. The Board shall adopt a corporate seal, which shall be in the 
         form of a circle and shall bear the corporation's name and the year and
         state in which it was incorporated.

Section 2. FISCAL YEAR. The fiscal year of the corporation shall be fixed by 
         resolution of the Board.

Section 3. VOTING OF SHARES IN OTHER CORPORATIONS. Shares in other corporations
         which are held by the corporation may be represented and voted by the
         Chairman of the Board, President or an Executive Vice President of this
         corporation or by proxy or proxies appointed by one of them. The Board
         may, however, appoint some other person to vote the shares.

Section 4. AMENDMENTS. By Laws may be amended, repealed or adopted by the 
         stockholders or by a majority of the entire Board, but any By Law
         adopted by the Board may be amended or repealed by the stockholders.

Section 5. DEFINITIONS. The term "entire Board" shall mean that number of 
         directors from time to time fixed pursuant to Section 1 of Article III.

Section 6. INCONSISTENT PROVISIONS. In the event that any provision of these By
         Laws is or becomes inconsistent with any provision of the certificate
         of incorporation, the General Corporation Law of the State of Delaware,
         any other applicable law, the provision of these By Laws shall not be
         given any effect to the extent of such inconsistency but shall
         otherwise be given full force and effect.

ARTICLE VII
         INDEMNIFICATION

Section 1. NATURE OF INDEMNITY. Each person who was or is made a party or is
         threatened to be made a party to or is involved in any action, suit or
         proceeding, whether civil, criminal, administrative or investigative
         (hereinafter a "proceeding"), by reason of the fact that he or she, is
         or was a director or officer, of the corporation or is or was serving
         at the request of the corporation as a director, officer, employee,
         fiduciary, or agent of another corporation or of a partnership, joint
         venture, trust or other enterprise including service with respect to
         employee benefit plans, whether 
<PAGE>

         the basis of such proceeding is alleged action in an official capacity
         as a director, officer, employee, fiduciary or agent or in any other
         capacity while serving as a director, officer, employee, fiduciary or
         agent, shall be indemnified and held harmless by the corporation to the
         fullest extent which it is empowered to do so by the General
         Corporation Law of the State of Delaware, as the same exists or may
         hereafter be amended against all expense, liability and loss
         (including, without limitation, attorneys' fees) actually and
         reasonably incurred by such person in connection with such proceeding
         if he or she acted in good faith and in a manner he or she reasonably
         believed to be in or not opposed to the best interests of the
         corporation and, with respect to any criminal action or proceeding, had
         no reasonable cause to believe his or her conduct was unlawful. Such
         indemnification shall inure to the benefit of his or her heirs,
         executors and administrators; provided, however, that, except as
         provided in Section 2 hereof, the corporation shall indemnify any such
         person seeking indemnification in connection with a proceeding
         initiated by such person only if such proceeding was authorized by the
         Board. The right to indemnification conferred in this Article VIII
         shall be a contract right and, subject to Sections 2 and 5 hereof,
         shall include the right to be paid by the corporation the expense
         incurred in defending any such proceeding in advance of its final
         disposition. The corporation may, by action of the Board, provide
         indemnification to employees, agents and fiduciaries of the corporation
         with the same scope and effect as the foregoing indemnification of
         directors and officers.

Section 2. PROCEDURE FOR INDEMNIFICATION OF DIRECTORS AND OFFICERS. Any
         indemnification of a director, officer, employee, fiduciary or agent of
         the corporation under Section 1 of this Article VIII or advance of
         expenses under Section 5 of this Article VIII shall be made promptly,
         and in any event the corporation shall use its best efforts to make
         such indemnification or advance within sixty (60) days, upon the
         written request of the director, officer, employee, fiduciary or agent.
         Notwithstanding the preceding sentence, if a determination (as defined
         in the General Corporation Law of the State of Delaware) by the
         corporation that the director, officer, employee, fiduciary or agent is
         entitled to indemnification pursuant to this Article VIII is required,
         and the corporation fails to respond within sixty (60) days to a
         written request for indemnity, the corporation shall be deemed to have
         approved the request. If the corporation denies a written request for
         indemnification or advancing of expenses, in whole or in part, or if
         payment in full pursuant to such request is not made within sixty (60)
         days after receipt of a written request and delivery of an undertaking
         required by the General Corporation Law of the State of Delaware, if
         any, the right to indemnification or advances as granted by this
         Article VIII shall be enforceable by the director, officer, employee,
         fiduciary or agent in any court of competent jurisdiction. Such
         person's costs and expenses incurred in connection with successfully
         establishing his or her right to indemnification, in whole or in part,
         in any such action shall also be indemnified by the corporation in
         accordance with this Article VIII. It shall be a defense to any such
         action (other than an action brought to enforce a claim for expenses
         incurred in defending any proceeding in advance of its final
         disposition where the required undertaking, if any, has been tendered
         to the corporation) that the claimant has not met the standards of
         conduct which make it permissible under the General Corporation Law of
         the State of Delaware for the corporation to indemnify the claimant for
         the amount claimed, but the burden of such defense shall be on the
         corporation. Neither the failure of the corporation (including the
         Board, its independent legal counsel, or its stockholders) to have made
         a determination prior to the commencement of such action that
         indemnification of the claimant is proper in the circumstances because
         he or she has met the applicable standard of conduct set forth in the
         General Corporation Law of the State of Delaware shall be a defense to
         the 
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         action for indemnification or create a presumption that the claimant
         has not met the applicable standard of conduct nor shall an actual
         determination by the corporation (including the Board, its independent
         legal counsel, or its stockholders) that the claimant has not met such
         applicable standard of conduct, or create a presumption that the
         claimant has not met the applicable standard of conduct.

Section 3. ARTICLE NOT EXCLUSIVE. The rights to indemnification and the payment
         of expenses incurred in defending a proceeding in advance of its final
         disposition conferred in this Article VIII shall not be exclusive of
         any other right which any person may have or hereafter acquire under
         any statute, provision of the certificate of incorporation, by law,
         agreement, vote of stockholders or disinterested directors or
         otherwise.

Section 4. INSURANCE. The corporation may purchase and maintain insurance on
         its own behalf and on behalf of any person who is or was a director,
         officer, employee, fiduciary, or agent of the corporation or was
         serving at the request of the corporation as a director, officer,
         employee or agent of another corporation, partnership, joint venture,
         trust or other enterprise against any liability asserted against him or
         her and incurred by him or her in any such capacity, whether or not the
         corporation would have the power to indemnify such person against such
         liability under this Article VIII.

Section 5. EXPENSES. Expenses incurred by any person described in Section 1 of
         this Article VIII in defending a proceeding shall be paid by the
         corporation in advance of such proceeding's final disposition upon
         receipt of any undertaking by or on behalf of the director or officer
         to repay such amount if it shall ultimately be determined that he or
         she is not entitled to be indemnified by the corporation. Such expenses
         incurred by other employees and agents may be so paid upon such terms
         and conditions, if any, as the Board deems appropriate.

Section 6. EMPLOYEES AND AGENTS. Persons who are not covered by the foregoing
         provisions of this Article VIII and who are or were employees or agents
         of the corporation, or who are or were serving at the request of the
         corporation as employees or agents of another corporation, partnership,
         joint venture, trust or other enterprise, may be indemnified to the
         extent authorized at any time or from time to time by the Board.

Section 7. CONTRACT RIGHTS. The provisions of this Article VIII shall be deemed
         to be a contract right between the corporation and each director or
         officer who serves in any such capacity at any time while this Article
         VIII and the relevant provisions of the General Corporation Law of the
         State of Delaware or other applicable law are in effect, and any repeal
         or modification of this Article VIII or any such law shall not affect
         any rights or obligations then existing with respect to any state of
         facts or proceeding then existing.

Section 8. MERGER OR CONSOLIDATION. For purposes of this Article VIII,
         references to "the corporation" shall include, in addition to the
         resulting corporation, any constituent corporation (including any
         constituent of a constituent) absorbed in a consolidation or merger
         which, if its separate existence had continued, would have had power
         and authority to indemnify its directors, officers, and employees or
         agents, so that any person who is or was a director, officer, employee
         or agent of such constituent corporation, or is or was serving at the
         request of such constituent 
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         corporation as a director, officer, employee, fiduciary or agent of
         another corporation, partnership, joint venture, trust or other
         enterprise, shall stand in the same position under this Article VIII
         with respect to the resulting or surviving corporation as he or she
         would have with respect to such constituent corporation if its separate
         existence had continued.

Section 9. SEVERABILITY. Whenever possible, each provision of this Article VIII
         shall be interpreted in such manner as to be effective and valid under
         applicable law, but if any provision of this Article VIII is held to be
         prohibited by or invalid under applicable law, such provision shall be
         ineffective only to the extent of such prohibition or invalidity
         without invalidating the other provisions of this Article VIII.